FINRA Rule 2081 expressly prohibits a broker-dealer from entering into a settlement agreement of the type that is the subject of this enforcement action. The broker-dealer was charged with violating that rule and agreed to a disciplinary action for such violation.

What purpose does the additional charge under Rule 2010 ("Standards of Commercial Honor and Principles of Trade") serve? FINRA has developed the practice of adding on a Rule 2010 violation to almost every single enforcement…

GameStop is a great story that should be made into a movie. The report misses the significant aspects of the story: that one guy sitting in his basement was able to capture the attention of thousands of retail investors who communicated with each other on Reddit, away from the regular structured means of interchange intermediated by regulated entities, and move the markets in a big-time way.

The GameStop story is not about whether the settlement cycle should be shortened. The report…

Enforcement actions involving crypto have picked up.

Beyond the timing, there are a number of noteworthy aspects of the action by NYAG Letitia James. First, the actions in regard to the issuance of the interest rate products follow closely on the very that it was prevented by the SEC from issuing an interest-bearing product that was very similar to others being offered in the market.

Second, the NYAG pointed to its authority under the Martin Act to directly regulate…

The government is not going to create a regulatory structure that is based upon the technology used to represent or transfer an asset. Nor should it. Proper regulation should be focused on (i) the purpose of an asset and (ii) its users, not on its technology or form. There are ways in which certain digital assets are unique; i.e., those digital assets that split the difference between being utility tokens and investment assets. Attention to SEC Commissioner Hester M. Peirce's proposal, which…